The turbulent housing market is reducing candidates' ability to relocate, causing problems for recruiters who want to place candidates in areas with skills shortages.

"Companies are having to be more creative with their relocation packages. We all know about the standard £8,000 tax-free allowances, but recently we have experienced companies paying two-and-a-half times that allowance," said Jeff Deacon, managing director of financial recruiter The Emerald Group: "We have dealt with clients in previous downturns who have purchased the [candidate’s] house and re-sold it later."

Rita Maguire, human resources director, National Grid Wireless, told Recruiter that if the firm really wanted a talented candidate it would be “extremely generous” in helping them to relocate: “We help them move home, put money up front for any mortgage expenses and offer the normal cash incentives.”